Foot Locker's Stock Plunges 26% Due to Weak Consumer Demand and Lowered Guidance
Originally Published 2 years ago — by CNBC
Foot Locker reported falling sales for another quarter and slashed its outlook for the second time this year, blaming "consumer softness" as inflation-weary customers hesitate to spend on footwear and apparel. The company's adjusted Q2 earnings were in line with expectations, but sales fell short and margins were impacted by promotions and higher shrink. Shares plunged 26% in pre-market trading. Foot Locker now expects sales to drop 8% to 9% for the year and cut its adjusted earnings guidance. The retailer has been relying on promotions to drive sales as its lower to middle-income customer base pulls back on discretionary spending. Comparable-store sales dropped 9.4% due to ongoing consumer softness and changes in vendor mix.